Friday, July 30, 2010

Friday is the day where I took smaller profit. But I always had a smooth Friday. Today 6A moved 20 ticks at the first attempt. I pushed my luck too far and stopped out par. While on CL a double wedge which is my favorite showed. So I entered with 1x stopped out and a flip I took a small 32 cents.

This month has been a great month. For the first time in my life, I trade with patience, discipline, and full control. Nothing else matter. Only a couple of trade go with the withtrend and it's acceptable and now added to my plan. The result: though I don't get the $5000 mark (only 92% target). But hey, I am not an employee and noone mad at me about the target. Have a nice weekend and a nice trade. :)

Mentally I can't stand to take profit early and then get in again at a much higher/lower price. My subconscious mind fight me. So to ride the trend more comfortable is to adding size at reasonable pullback or new hi/lo. If the price going back against you, at least you can get out with less losses. It's actually the same with the first method but it's more comfortable. Today I ride the 6A and it's failed. At least I could get out Breakeven. Let the 20ticks dissapeared.

Thursday, July 29, 2010

My first plan is waiting the CL pullback 10 cents from the initial entry. I called it a washout Stop Loss. And after many pullback, it did happened. So I entered it. The price wiggle around an I exit for 5cent. Yep!! 5 cent because I wanted to go watch SALT on Theatre. And how much it cost? 200 cent!!

This time I was busted. 1st attempt EUR failed, I didn't flip which is costly mistake. 1st attempt GBP quite good, avg up and stopped out at modest loss.1st attempt JPY failed, 2nd flip I got out since I wanted to focus on AUD which is a good decision. But if I flipped again, the profit will be enormous. While AUD I tried to milked the ride, one avg up stopped out and finally got out with standard profit. Maybe end of day but we'll see.Have a nice day

Tips : Here's some brief explanation about how I trade:1. Reliable system which consist of consolidation and price action.2. Diversification.3. Patience waiting the signal appear.4. Discipline with the plan.5. Persistence at least until booked a modest profit.

Wednesday, July 28, 2010

Let's say you want to buy a car. And the price car dropped to the lowest price of the year. And the news came out that government will raise the car sales tax next month. Big possibilities you will buy the car as the price is already very cheap and next month the overall price will likely to go up as the tax applied. We do it at every other aspect in life. Buy wholesale groceries when it's in discount for monthly stock, searching the best bargain, and so on. This habit trick our mind to always buy on the low price.

Unfortunately trading can't be treated like that. Sometimes it work. Most of the time it won't. You're agresivelly buying and averaging down on the downtrend because the price is very very cheap already. You reluctantly buying the uptrend because the price is already high. Or worse, you short the uptrend because of the same reason. Also it's very uncomfortable to buy/sold everytime price move with your favor. You won't buy groceries more than 10 if every 10 items purchased, the price will going up, unless it's emergency. This habit is not your fault. We lived with this habit in this world every day. That's another reason why most traders failed in the beginning of the journey. They didn't realize this habit actually sabotaging their account. This mindset bombarding your mind almost every day since you learnt how to do the math. How many advertisement every day with a discount, clearing house, bargain, cashback, redeem, etc you see? More than 10 times in a day I guess.

So how to fight it? It's a matter of how much trust you have on your trading system. Do the unconvenient way, buy the overbought, sell the oversold if your system said so. The risk is greater for reversal, so it's your SL to do the job. Sometimes it won't work. But you'll be surpise how further more the price will move beyond your expectation. Do it until it planted in your subconscious mind.

Just another sharing thought from my idle mind. Hope this help :)

PS : one good article http://www.smbtraining.com/blog/could-you-reenter

Text Book Trading, I missed the JPY movement and I entered single wedge AUD since CHF moved erratically, no signal on GBP, and EUR moved earlier than my trading time.

I applied the pullback avg up entry, stopped out with very small losses since my initial entry is far above. And re-entry another pullback with the same price. Since I am a defensive trader, I feel comfortable if my stop is small even though there's a lot of red in my trades. ( I am blessed I am not a perfectionist :) ).While CL trade is screaming to buy. A little scalp won't hurt :One mistake @ 6A, wanted to enter buy limit on 888, I added position on 996. So I waited with my previous SL spot unchanged. Entered with 2 ticks profit, and won't wait longer to get out with nice >$200 profit. And price move another 20 ticks :(

Tuesday, July 27, 2010

Here's some tips for withtrend trader. And you should consider to become a trend trader rather than a fade trader.1. Most of trends have pullback. If you entered at the early trend, you're in luck. If there's pullback, especially if your first entry is already far far behind, then enter every withtrend break after pullback is a good idea. However, the pullback entry must be treated separated from the first entry. So the SL is different, which is closer than the first entry. The idea is to ride the trend with a minimum risk. Let's say if you trade full size on the first entry, the SL may hurt deeper than let's say half size or even quarter size. It's more convenient to stopped out 3x times in a row with quarter size then 2x with full size. Do the math, plus the effect from your mentality breakdown. It's not guaranteed that you will make profit with this method but at least you play safe but aggresive when opportunity come.2. After a pullback, most trends will make a new hi/lo. This is a 101 technical analysis. If you want to get out, wait for a pullback and enter at the new hi/lo for additional bonus. Not work everytime, but quite reliable especially for semi scalper like me.3. Saving some capital for this opportunity is priceless. I used it today and will do it later. I rather loss small than missing the big ride. And I have bad habit not running my profit long enough. Adding size while the market is on your way is like adding gas for a boat flowing with the wind.

This tips may help your mental state a lot. At least for me. I can bear skipping some small profit while waiting for the big ride. Cause I know the big ride will erase my small losses and give me bigger chunks of profit.

The idea for this tips is also maintaining the mental state of the traders. I can assure you, after taking ONE BIG LOSSES, it's DIFFICULT TO GET BACK TO THE PREVIOUS GOOD MENTAL TRADING STATE IMMEDIATELY. Done that dozens of time and if you don't agree, please do it by yourself. I was tilt and unwilling to trade for one week after losing my 2 weeks profit in 1 day. It took me a whole two weeks to get back into my trading state again.

Okay, I picked the wrong futures. I should pick 6E or 6B for quicker result. Instead I pick 6A which is slow, chop, and...slow.Trade like a text book, faked out 4 times. I was on my last attempt. If my last entry failed, I stopped trading 6A for today. However 6A didn't eat my SL. I did the pullback entry multiple times. I entered first barrier, then double barrier, than a pullback. 3 contracts with a quite low risk. My pullback entry stopped out two times. While 6A on the verge at 0.9000, I was unstable. I knew I could get at least 1 or 2 ticks on around 0.9000. But I changed my plan. Exit @ 95 and 99, last exit on 107 make my day :)

A good setup combined with good MM and experience result a good profit.

Monday, July 26, 2010

Another great discpline approach. This time I trade Swiss Franc (6S). I've never trade this and I even falsely $$$ per tick. However, the beauty of my Trading System is whatever instrument, it can be applied.

CL is just a bonus trade, saw a double wedge pattern, ignored the 1st break and entered the second signal. (Let me tell you 2nd Entry from double wedged is the most powerful signal I've ever seen on Crude Oil, especially the reversal)for quick scalp and exit. Of course, price soared through my initial entry far far away.

Now some tips. My favorite things to do is now doing scaling up. This is a miracle in trading world. While others prefer averaging down, I do the opposite. Think about this: You enter 1 contract at not so good setup. And you got stopped out with 1 contract loss only. And you enter again and you ride the trend, another signal appeared and you averaging up. Adjust the SL and you have double the potential with only small risk because of the adjustment.

Another tips : The advantage of riding the trend is most of the time the trend move farther than you think it is. And it will be a lot of pullback on the way. If you want to get out, wait for pull back then adding contract if it break the new hi/lo. Give you some extra ticks/pips with double the power.

I do averaging down a lot not so long ago. The reason is, I don't like taking Stop Loss. While now, I still don't like taking Stop Loss. I guess noone like. But accept it as part of business plan. Think like an expense for business. And since then, my trading performance like increased multiple fold. Sometimes it's just that simple to flip struggling into winning. Wish you have a great trade :)

Friday, July 23, 2010

Here’s the Bonus Post as promised:I’m not gonna write about my setup. It’s obvious I used the Wedge Technique. I’d like to share little secret that actually pretty simple. To become a profitable trader, you only need one setup that cover essence of Price Action. There’s too much things to talk about. In this post I will focus on System Trading.This is what I have in my Trading System:1. Price Action based System.Price Action work. Enough Said. Maybe there’re some traders profitable with indicator like MACD, Stoch, etc. But with Price Action, I can do pre-emptive strike. I convince the other indicator not yet show their confirmation. Of course the risk is I often got stopped out. But when I’m right, I can wiped those little stop out plus profit.2. Consolidation information.This is maybe not many indicator have it. The consolidation give more information rather than “Shoot : Hit or Miss” setup. If I’ve been stopped out in consolidation, it doesn’t mean the setup is not working. I can re-entry multiple time in the same price, stopped out back and forth. That’s the risk having a tight SL. But the more consolidation, the more powerful it can break. It’s like compounding the powder to do firework. It’s natural to averaging up after long consolidation. I did it today because the firework usually fly much much higher than usual and can wipe five, even ten little losses plus profit. And consolidation is the core of wedge technique.3. Semi mechanical entry.I rarely enter the first signal at single wedge. But I entered first signal on double wedge. It’s a little discretion in this trade but still in the wedge zone. It’s hard to define it with words. It’s dynamic rules on static technique. I treat Crude Light different with Currency. But it all comes down to the same Price Action essence.4. Weekly backtest and review.This is a homework for all of us day trader. Even if we have a bad week, it doesn’t mean we have a bad system. While in backtest, we can flashback what we did wrong, and fix it in the next round. I always gain confidence even if my performance was bad knowing that my system work well. It means I still can use it. Sometimes it’s just a matter of execution.5. Diversification.I know some of traders think specialize one instrument over and over again make him an expert in this area. Let’s say ES. Sometimes this bugger just chopped and whipsawed all day long. So, you get a chop gain or whipsaw gain or even losses. Here’s another secret stuff. Diversify the trade to other instrument let me ride the right trending one and dump the whipsaw trade. I love currency because of this reason. I can diversify which one give me the best signal, I enter. I enter every signal, if all work out, good. If not, most of the time at least one instrument become the savior of the day.

I hope this post may give an inspiration to treat your setup and maybe find the right one. Too many times traders (myself included) change system while maybe we only need to master the old one more thoroughly. There's too much information in just one system.

Wednesday, July 21, 2010

As usual, I wedge the JPY. It already faked multiple times so it's quite safe to enter. I just took 12 ticks which is too early. While CL I wait and wait, nothing happened. Maybe everybody waiting for inventory report. So I got out in minimum profit. daily target only slightly reached. End of trade

I don't like slow market. I prefer stopped out multiple times in dynamic market so I can get out early. The longer I wait, the bigger chance I make mistake. Fight another day.

Tuesday, July 20, 2010

When I was kid, I read a manga titled "Kenji". It's about an adventure of young boy who learnt various kung fu and become a master himself.

One of the side story told about a young man which is fat and often scolded by his friends. He want to learn kung fu to gain respect from others. His teacher saw him not a very bright kid and only gave him one simple kung fu moves. He instructed to do only that move. No other kung fu move he learnt. He practiced days and nights and years, just repeat the move over and over again. Repeat it only this move. Until one day he was challenged by a kung fu expert, one who often bullied him. The fat kid accepted and he defeated his opponent very fast, with only this simple move. The audience shocked and plaused his victory. While his teacher smiled in the distance to see his student now become a champion.

I trade the market with only one move. Wedges over and over again repeatedly. I improved and mastered this move day and night, backtest, optimized, to become my single deadly weapon on any given market. This move alone can generate to multiple strategies, entry, exit, money management. I don't use any other technique right now. And this move alone give me good profit and great risk-reward ratio. This move consists of single wedge, expanding wedge, double wedge, triple wedge, border wedge, flat wedge,etc. The market will fight me with fake out, slippage, double fake out, choppy, whipsawed, 1 tick trapped and so on. Every market move, I'll learn to counter or redeem its attack with pullback, flipper, double entry attack. And I will defense myself from market with regular SL, hard SL, breakeven Stop, market diversification, tight SL. I also combo if I have the upper hand with Running Profit, Pullback entry, or final breath breakout entry. All rooted to only one simple move.... Wedge ...

So, if you think market is complicated, think again. Maybe it's us that make it looked complicated.

PS: Damn, the CL rally like hell after he broke the flat wedge. Run another 100cent. Fight Another Day :)

6E Formed a double wedge setup, entered long first, the price stalled for a while and suddenly the brief shocked wave surged the price down eat my SL. I already prepared for the that so I placed 2 contracts on my SL. Now in short mode, the price only lasted for seconds and shot to the sky. The real move. Once again, I flipped to long. I didn't want to miss this move, wherever it went, I just want to be a part of it. I paid my price: 2x Stopped out. Now the wave getting bigger and bigger...and I saw the 1300 rock. This is a chance to skip the rock and ride to the blue ocean. Two choices, pick the small gold on the sand or waited the waves slammed the rock. If the wave leaped, more pots of gold will appear on the other side. If not, the gold in the sand will washed through the oblivion. I chose to bail out and take my share. The wave of course slammed the rock and bring whoever ride it with more pots of gold behind it. No regret, lesson learnt.

CL : Actually CL rollover week usually provide a rough field for trading. Monday did not happen like that. In fact, the CL acted like a broken fat ATM. poured thousands of $$$. And I saluted for everybody who waited patiently to collect the money. As if the CL acted stalled today. No money collected. At least until 10.00am maybe. Even triple wedge setup didn't do any good. I picked whatever left inside. At least the double wedge may give me 1pcs of Ben Franklin and it did. And the ATM at the morning not pouring money, it sucked money. End of trade.

Monday, July 19, 2010

My internet connection jammed and the chart was lacked. I entered the 4th entry. First three entries were faked. I longed and the price stalled there. I place 2 short below. 1 SL, 1 for flipping the position into short. So I remembered to place an airbag. I place 1 contract in case my SL limit slipped. While the connection still bad, suddenly the price reversed and I have 2 shorts. If I don't have a bad connection I will cancel the airbag. But it's already too late. I exit 1 position with small profit, less than my previous loss, and exit the remaining position with decent profit. Daily profit reached. End of the day. CL rollover week seemed difficult to trade. :)

Sunday, July 18, 2010

I accidentally visit a blog where the trader lost -1000pips in 3 days. And the amazing things is he/she never lost even once in June's trade. He/she collected 450++pips in June and loss 1000pips just in 3 days. And I believe he/she will add more loss if he still kept his open position until now...or being wiped out already. He/she shorted EUR since first of July. Ouch...

I used to be like that. In fact, maybe someday I will do it again. This is a lesson that winning ratio is nothing. It's even dangerous to us as traders. Imagine how you felt when losing all your monthly profit plus more in just 1 day? It's more painful than doing nothing. Your self-confidence, pride, were crushed in just one night. It's more painful than missing 1000 opportunities. I did it multple times. And it's really hurt. I couldn't sleep well, wanted to give up, and all negative emotions. And what happened to the next day? I couldn't trade like I used to be. Losses after losses mounted. Imagine how the chain reaction would happened. It all happened to me and I am sure it happened to most of us.

Bad things won't hurt you until it happened. I learnt from a great trader, my educator. that a STOP LIMIT is a dangerous thing. It may slipped out and won't get filled. I use the STOP LIMIT. Sometimes it slipped and I won't get fill. Luckily it didn't hurt me too much until this time. But bad things won't hurt until it happened. Prepare for the worst is essential for trading. Regular Stop Loss is not enough. Adding a hard Stop Loss is a very improtant to do. Seat belt and Air Bag. Here's what I learn in my 3 years experience of trading:1. Do not do impulsive averaging down. I am not against averaging down if it's according to trading plan. But I believe most of retail traders averaging down because of :a. Want to get out from the trade at least on Breakevenb. Feel (???) the price is already cheap or expensiveNone of them when trading said: Well, I enter in this spot, this is my trading zone. If the price goes against me until this spot, I will buy more, this is where my SL, etc. Amost every traders in the world want their entry at the best price on the first shot. Admit it. It's human nature. Here's the best things to do. Do enter at the signal, and get ready for every posibillity. Faked, Breakout, Pullback, Reversed, Double Faked, Triple Faked, Stopped out, etc. 2. Respect the Stop Loss, use the Air Bag instead only the seatbelt. Let's say your SL is 1% capital. Put hard stop at 2% capital. It's all about respect the Market.You'll never knew when you'll get slipped out, stunned and the price already eat 5% capital. This is what I'll do starting this Monday.3. You can't go broke taking profit. Well, unless you have 100% winning ratio system which is impossible, you still can go broke. Even if you have 99% winning ratio, you still can go broke. The important thing is Risk-Reward Ratio. There's two things in trading that is so simple yet so difficult to do. Cut loss early, let profit run. You may see my trading at my previous posts. My winning ratio per trade less than 40%and still make profit 10% with no losing day this week. It can be done. Or you may want 100% winning ratio on June with 450++pips profit and losses 1000pips in 3 days on July. Your choice. 4. Realized profit isn't your money yet unless you quit trading forever. Open position may change, everybody knows. But realized profit also can change. Who knows the profit today will evaporate tomorrow. This is difficult to accept. We are trained to get paid on our job. Since we're born, we will get reward if we did something productive. While in trading, even if we do something right, we still and absolutely may lose money. Sometimes, market won't pay our work, even taking our money for our work. It's worst than slavery. It's like not getting paid for our job and being mugged when we got home, BY OUR OWN BOSS!!! Get used to it.5. Have a system. This is your gem. Have a system, confidence, and go for it with patience and discipline. If you kept shooting blindly, how to analyze what's worked and what's not? Let's see I'm gona buy here cause I feel (???). Next time you want to know the reason why you enter, even when you keep a journal why you took the trade, because at that time you feel (???). Feeling cannot reviewed objectively. Market is too complex. It's better to review or backtest the system. It's more convenient and easier to do rather than collecting market profile data which is too complex even for the most experienced traders. It's your job as a trader finding a good system off hour market, and trade the system at market hour. Plan and execution. Even after you find a good system, execution still need a good work.6, Day Trader advice... Do not have a bias, especially if we're still new at the market. Bias may go wrong. We are not a fortune teller to predict market movement. Trade what you see, not what you think. This is so true.

That's it for now. It's probably my longest posts yet. I put all my heart in this post. Please, I just want to help every traders I can reach that: Don't Do it recklessly. This is serious business. For those who never experience pain like me, be grateful cause you can learn from others' failure. For those who share the same experience, stop the mistakes. Everytime you enter the trade, remember how painful it is to broke the rule. how dangerous it is for your mental and physical health, your family and your financial statement. It takes only one day plus one mistake to wipe out your capital and left us wasted.

Friday, July 16, 2010

I don't want to get full throttle on expiration day. Catch one good setup, scaling up and exit early. 6 minutes trade, finish early, enjoy the weekend :)No trade tonight

Every trade I made were text book. Some trade slipped a little and cost me $399,-. Two discretionary trades but still with trend entry. I must say every trade I made is a withtrend this week. I am proud of it :)

Thursday, July 15, 2010

Maybe it's an obvious question but I think I will give some of my thought about it.

Every participants in the market has one purpose only when trading : TO MAKE MONEY!!Whether it's retail trader, fund manager, BlackBox Trader, Algo Trader, HFT, etc. Only one single purpose: TO MAKE MONEY!!

It's like a soccer game. The main objective is to win the game. So, if their gate is in danger, every defenders will do the obvious things. Defending the gate. It may be a tackle, block the shoot, or blocking the player. It's natural thing to do and it has a pattern.

This purpose alone also can give you a pattern in a chart. The "TO MAKE MONEY" objectives will give some scenario like : where to entry, exit, profit taking, stop loss. Think about it. If a trader has a loser trading setup, he won't use it as it didn't make him money. However if he has a winning setup he will use it over and over again until it won't work anymore. Use it over and over again from million of participants out there may create a pattern that repeat over and over again. A novice who trade recklessly may become washed out in the long run or he has to join the community of over and over again sucessful traders to become a sucessful trader. Unfortunately only few traders can join the elite group trader.

This is my opinion why market has patterns. Because one purpose : TO MAKE MONEY...

For those of you who doubting the market has a random action, it's not. Everyone in the market has only one purpose. Like soccer players in the field has one purpose to score.

Wednesday, July 14, 2010

I longed JPY and AUD. Both of them had a negative corelation while both of them giving buy signal. Entered both of them, close both of them. Next time I just put Breakeven stop and let one of them prevail.Stopped out by AUD just 1 tick and let GBP run too far away until it reverse and stopped on breakeven. Well, once again THANK YOU CL.. :)

Tuesday, July 13, 2010

Flash backed when I was an employee, I was an administration finance supervisor. A good position for most of people. I lived in a country where most of the people's dream is having a decent job till they're retired and die peacefully. Sometimes they have passion in their life to life with to the fullest, pursuing their dream but after was offered with a good job or promotion, they dumped their dream. One of retiree from my ex-company wrote a poem how he's being 'fallen asleep' and at the retirement day he felt so empty that he forgot to pursued the mountain because of pretty beautiful butterfly around him. Honestly, I will be more prosperous if I was still at the company.

I was not happy. I worked at noon, trading at night. I did this for two years. I did foul things when I was working. I was not fulfilled. And when I was offered to resign with a decent compensation, I took it. Now I am a full time trader. Up and down most of the month. But luckily I wasn't wiped out. I trade defensively, learn lot of things and become a better trader nowadays. I am not a supertrader who achieved $1000+ per day yet. Now,I am more happy these days. Sometimes I got bored but it's normal in everything we do.

At first, my motivation was to show every people I knew that I am a successful trader. But I think it may atrract more problem when they want any freebies from my knowledge. I am not stinky, but if somebody want to get rich quick. I can't help, like all of them think that's what I do right now. Trading is not my final destination. Trading may provide me freedom and more time to do what I want unlike any other job or career. And of course, when the time come, my gain from trading will surpass every single people I knew in that company. Right now, I just trade defensively and improving at every single minute.

Sunday, July 11, 2010

I’d like to give an interesting story here. It’s about trading career in my country. I live in developed country, where day trader seemed a strange career, and sometimes a lowly career. Well, I can’t blame that. Lack of knowledge usually invite suspicious. And I will give you short story about it.

As to my surprise, there’s a lot of prop firm here in my country. Most of their trading instrument is Hang Seng Index and Nikkei, because it’s convenience with the hour here. The prop firm have the sales forces to attract money from public. They will aggressively ask you to invest money at the prop and trade the money at the index. Usually it took minimum $10.000 per account. Hang Seng Index worth $5 per point, just like Mini Dow. Everything seemed normal, right? Now here’s the bad thing. Let me breakdown it to numbers:1. The sales force is also the trader. They trade their customer’s money. Usually they will ask permission for entering position, or just doing what their customer want. They took commission for every trade. Now, we have a broker doubled as a salesman. Not a trader.2. The turnover is very high. The prop will recruit every person who can give the company’s money. The prop have little interest with your background, education, personality, or so on. So the sales force will consist fresh graduate college boy who doesn’t have job yet, or difficult to have the job. The prop only care for how to get the customer and create money for them. Now, we have a not competent human resources. At least most of them.3. The commission is very high. Around $20 / contract per round turn. And the other thing is the spread. The firm give a huge spread, around 10 points. I forgot the detail. But it’s around $100 per round only for commission. Now, we have high commission.Good Sales Force + Low educated trader + High Comission = Financial Disaster for Customer. That’s make my career as trader seemed very low in public. I am not saying those prop firm guy all of them is a scammer. Maybe some of them became a great trader. But I am very positive there will be only a fraction of them.

What a bad name given to traders. I remembered one of my long time no see friend saw me cynically about my job as a full time trader. I really want to ignore it but the one you resist, persist..Keep the job right, persistent, discipline, and patience, I believe we can have a better life than most of them who pursue career at the corporate world. Maybe not on authority or money, but freedom, fulfillment in life. I want to travel around the world while trading. Not just vacation, but temporary stay while learning something there. One of the thing that most if not almost all job that can't do like this. Just take the advantage.

Friday, July 9, 2010

Well, this isn't about my account. I never being wiped out because I always added funds he3x.

It's about my friend. Actually he lost $2000 which is most people it's small. But for him it's big. First he traded around $500, wiped out. Then $1000, I invested $500on him, also wiped out. Last account $600, recently wiped out. I don't know what's wrong with him, but his trading method heavily rely on news and technical analysis. He traded Options by the way.

You may think this guy is a stupid dumb a**. But he's smart. Smarter than me actually. He can spot hot stocks and most of the time he did it right. He is a great influencer. His talk is very convincing. Sometimes I was attracted with his trade and also bought same stuff with him. Why he wiped out his account? simple. options expired worthless. All of them. Not consistent Stop Loss, Profit Taking too early, which I did it also. The scenario run like this. He bought 1 contract, the price moved against him, or just slightly break even. He wanted to keep it overnight. Next day the price gapping against him. He got out with quite big losses. And the price went back to his favor, almost like it had eyes on him. Sometimes almost exact price before it reversed. He felt angered. He was right but taking too early. And he never re-entry because emotion and pain clouded his judgement. Other day, he may bought another contract. Maybe different stocks. And the price dive again and he kept it overnight. This time he won't stop losses. And guess what, the options became worthless, his account were wiped out.I never mentioned about profit taking because he never took big profit. Always small profit. 3 same mistakes, did it over and over again. He still smart actually. But I think the way he took is slightly wrong.

And in daytrading, I'm still thinking that more idiot = better result. Gave him/her top notch trading system, and that's it. No news, no bias. Just chart, trading system, money management, just trade it. Smarter you are, more question appeared, and you may miss the entry or chasing the price. Everybody want to become Jesse Livermore, who could outsmart the market, or Analytical thinking like Kenny Roger guy. Well, it's good to become a great man. But in reality, especially day trading, those skills is not very important. All you need to do is spottted where the market likely to go TODAY and go with the flow. Sounds easy right, it took me 3 years to realize that. This week I implemented purely the trading system. No discretion entry. I bought an overprice CL, selling the cheap 6B, and so on. I just following the system. Result : Not bad, $500++ in 5 days. It's small but have big potential in it. The result may double if I just waiting another 5minutes for profit taking. That's it. To make it double again, I just need adding 1 more contract which I still can afford.

Stupid man = Good TraderSmart man = Good Analyst

Smart man : Are you crazy? You bought the CL on all time high? It's already moved $2 intraday. Very soon the price will dive south, don't you know the inventory is good, APEC don't want to reduce supply. bla bla bla...Stupid man : Gee... I don't know. I just follow my system. It's buy signal. Putting my SL intact and waiting for the result.Smart man : your system is bag of c**p. Use your head. You followed the herd buying the overprice CL. Soon you will realize your stupid trade.Stupid man : Well, if I was wrong, my SL will do the job, All I need to do is waiting for another setup whether it's buy or sell I don't care. I am not smart enough analyzing the news, sentiment, opinion,etc. I just checking my system and my trade. That's all.

Oooh, I wanted to become the stupid man. And this week, I am this stupid man :)

Thursday, July 8, 2010

We already broke the old red channel line. Resistance on 75.50 - 76.00. If cleared, expect the price to go up at 76.60 - 77.00. Likely the intersection where red channel line meet the green channel line will create heavy resistance. The cross will occur at 77.00 - 77.50. From there, the price may fall down to the bottom of green line. Notice the lower low at upper blue line and channel change from uptrend to downtrend? It's the sign of weakness of CL. Although I bought CL today cause I am not use this analysis on my trade. My capital won't allow me to SL at 100cent. But for those who can, hope this analysis help.

I trade defensively today. Currency trade not very good because of too damn slow movement. If I had patient enough, it may produce good result more than 20ticks for JPY. AUD will be stopped out.

CL, I traded like robot. Signal appeared, I went. Didin't have bias at all. I even felt very uncomfortable buying at peak. But I couldn't hesitate. Stopped out twice at first then the last trade covered it all plus little bonus attached :)

Missed TF setup but if I entered every signal there, at best I only breakeven. So no complained. TF is a tricky animal. Sometimes making 3x faked out before went directional. So my strategy I won't even enter at the first signal.

Wednesday, July 7, 2010

I mostly trade like robot today. No bias, no discretion. Just waiting patiently for the setup appeared, and entered graciously. Result : No losing trade on Currency, but a very bad trade as taking profit too early.CL : 4 consequtive losses and 1 break even. Really gave me headache. But still trade with discipline and determination.TF : 2 consequtive losses and missed the final entry that fly to 6++pts.

Result : decent profit with disciplined trade. Have to fix on Profit Taking side as my emotion kept interfering.

It's very harshed to see a market like today. Moved slow, retrace deep and go what it have to go, retrace again. There's 10 ticks all over the way, missed 3 opportunities..

I found that revisit or retrace to a key price is vary often happened especially in ranging market. Entering at 2nd opportunity sometimes gave better entry. Should broadened my setup to reap more ticks.

Monday, July 5, 2010

If I let my SL loose, I may not taking small losses and may booked bigger profit. But this is the result of iron-clawed discipline trade. No doubt I bought higher price, which is very uncomfortable for me, but when my signal appeared, I had to do it no matter what. Exit beautifully on temporary peak.

If I took only 8 ticks on every trades, I may booked 39 ticks in just 3 hours. It gained my confidence that my system worked!!! :)The challenge now : applied it with pure disciplined and developed the profit taking system. While my SL is already intact.

I still used the wedging technique with additional of volume analysis. I won't enter the trade if there's decreasing volume and spiky volume. Sometimes it worked, other time it won't. At least I knew the increasing volume showed more participation with the move. That's giving me a little peace of mind.